The energy–capital complementarity debate: an example of a bootstrapped sensitivity analysis

The aggregate production function approach is one way to forecast future energy demand (a step in forecasting carbon dioxide emissions, for example) and to analyse the aggregate economic effects of measures such as the increase of taxes on energy use. The results of such an approach tend to hinge on whether energy and capital are substitutes, implying that increases in energy prices will increase the demand for capital stock; or are …